SYH Investments CC
Kagiso Media Limited Analyst: Tshepiso Appie
Introduction In the following report, Kagiso Media Ltd will be evaluated for the inclusion in the investment portfolio of SYH Investments CC. The company and the industry in which the Kagiso Media Ltd (hereafter referred to as Kagiso) operates in shall be described in the report. A fundamental analysis of Kagiso shall also be provided; and it shall be concluded whether Kagiso should be a part of the investment portfolio of SYH Investments CC. Company Overview
Kagiso Media Limited, through its subsidiaries, operates as a media company in South Africa. It operates media outlets in the fields of regional radio broadcasting, airtime and Internet sales, information services and solutions, out-of-home advertising, and exhibitions and events. Kagiso operates in five segments: broadcasting, content, information services and solutions, outdoor and exhibitions and events. The company’s broadcasting business comprises operations in the radio broadcasting and radio advertising sales environment, and research and marketing services. Its radio stations offer audiences to national and local advertisers, who buy traditional above-the-line advertising airtime directly from the radio stations. Kagiso has a controlling investment in East Coast Radio and Jacaranda 94.2 and strategic stakes in OFM (Bloemfontein), Heart 104.9 (Cape Town) and iGagasi 99.5 (Kwa-Zulu Natal). The group also has an economic interest in Kaya Fm (Johannesburg). Kagiso has joint control of RadMark and Acceleration Media. RadMark
represents the group’s stations to national advertisers and advertising agencies and Acceleration Media is involved in the execution, management and optimisation of digital campaigns- focusing on online media, search marketing and mobile solutions offerings to clients both locally and internationally. Kagiso also has joint control of Primetime Kagiso in India- operating under the RadioMinds brand name, this business was set up to offer the Asian radio market a range of consultancy services. .The
Company publishes information in the areas of law, tax, and accounting, in printed and
electronic form, and sells this to subscribers, professionals, and tertiary students. The information services operate through LexisNexis which is a leading provider of business information solutions. It also provides legal compliance management services and access to public records, through its sales forces and via an internet-based purchasing system.
Under the content segment: Kagiso has a controlling investment in Urban Brew. Urban Brew is involved in the creation and the distribution of audiovisual content on any platform – trading in television and music content. Popular TV shows developed by Urban Brew include YO-TV, 3Talk and the Lotto Draw.
In addition, Kagiso Media Limited focuses on out-of-home advertising in the South African airports and railway stations, as well as involves in online advertising. Kagiso Outdoor owns 50,1% of Merafe Outdoor which is one of the biggest out-of-home advertising operators in the airport and rail advertising market in South Africa. It advertises on billboards, gantries, citilites, wraps, and various other platforms. Further, the company offers a direct marketing platform to advertisers; and provides television production, online media agency, and sport sponsorship and digital technology advertising services. Kagiso Media Limited was founded in 1997 and is headquartered in Illovo, South Africa (Business Week, 2010). A strategic review of the exhibitions and events business informed Kagiso Media’s decision to wind down the business by disposing of assets. In May 2009, the group disposed of its 50% shareholding in the Johannesburg International Motor Show to the National Association of Automobile Manufacturers of South Africa (NAAMSA) (Kagiso Media, 2010).
The media industry of South Africa is quite developed in relation...
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